in an aviation accident. It’s still too
much. Four hundred people, sadly,
were killed last year in aviation
accidents, but when you think about

10,000 people at home that doesn’t
make it newsworthy.

So having the FAA take an active
role to promote aviation, which
they used to do — it was an active
part of their charter — would be
something I’d ask them to do. It
seems currently that that’s not in
vogue, but I think it is important
that these organizations take a view
that aviation is critical. It’s a critical
export. It’s a critical transportation.

It’s a critical business path. It’s
critical at least in the United States,
and we don’t have the government
supporting it.

JEFF MULDER: There have been
a number of other aviation issues
in the news recently, and I’m just
curious from your perspective.

And I’ll start with Paul because it
probably is impacting your sector
more than any others — Congress
considered not renewing the Export-Import Bank. and there certainly
are arguments on both sides for
that, but can you just bring us up
to speed on how it’s impacting
the industry.

PAUL FELDMAN: It has had an
impact, and it has an impact on
both small and large businesses.

We have some agricultural aircraft
companies that export, and
they’ve had problems exporting
their products. And suppliers are
being told not to hire because the
companies they work with aren’t as
sure of export sales as they would
be otherwise.

Back to this whole questionabout aviation promotion, I thinkthe Ex-Im issue is the perfect oneof maybe where we’ve gotten offtrack a little bit because we havespent two years now arguing aboutreauthorization of a bank. So ratherthan promoting aviation, we’ve beenfighting about a basic program thathelps us compete globally. And itjust seems like that’s not the kindof discussion that helps aviationat all or promotes aviation, and so,hopefully, we’ll be able to get tomore practical issues and how wemove the industry forward.

JEFF MULDER: Another topic that’s
come up that airports have paid
attention to is the issue of open
skies. Of course, aviation is more
international than ever, yet the
conversation in Washington has
been about closing some of that
from an open skies perspective. So,
Bill, your thoughts about that and
the impact on aviation?

BILL SWELBAR: It isn’t an open
skies issue. There are 117 open skies
agreements. There are two which
are being questioned as adhering
to the language and the spirit of
an open skies agreement. If you
take a look at economic theory,
international trade theory, these
two countries and three carriers
in question are behaving as if
subsidized players are present. If
that is indeed the case, then let’s
have consultations and work our
way through this. If not, let’s get on
with it and compete. That is how I
see the issue in question. It is how
I’ve written on the topic, and it’s
just — well, I will say that I firmly
believe that there are attributes of
subsidy at play here, and subsidies
are in violation of Section 11. 1 of
every open skies agreement.

I understand why the U.S.
carriers are excited about it. In
my view, it has less to do with
third- and fourth- freedom flying.

It has everything to do with
increased fifth-freedom flying.

Today, Emirates is flying betweenNew York and Milan. If we wereto continue to see more and moreof that type of flying — it starts tocut at the very fabric of a network,and I do believe that that’s why theU.S. carriers are quite interested inthis issue before it goes too far. It’snot a popular issue. I get that, butit is something that, if it does playitself out, with the sheer numberof airplanes that are on orderamong the Gulf carriers, they haveto go somewhere, and I don’t seeenough third- and fourth-freedomopportunities, but I see plentyof fifths.

JEFF MULDER: Something that
I’ve noticed — and this goes to the
question of foreign ownership. I
don’t know if I’m using the right
terminology — cabotage and other
things that have been in place for
a number of years. In Europe, the
largest carriers are actually carriers
like Ryanair and EasyJet, which
provide incredible connectivity,
affordable fares, and that would
be the example. It’s different than
the U.S., of course, but that’s where
you have carriers flying across
international lines with well-established networks, yet we really
don’t have that opportunity here
in the U.S. I think we’re concerned
about the fact that the marketplace
with consolidation has shrunk,
and are these rules from the past
still applicable?

BILL SWELBAR: No, I don’t think
that they’re applicable, but I do
think that we should entertain
the conversation regarding
cabotage. I do believe it’s a relic of
protectionism, if you will, but at
the same time, I don’t expect to see
that conversation in my lifetime.
Organized labor is so vehement
against the idea and the fact that
organized labor clearly has the ear
of the White House and Capitol
Hill, we’re not going to have that
conversation anytime soon. Would
cabotage really mean that much